Ethnic Conflict in Ex-Soviet Region Keeps Riches out of Reach Fierce Rivalry over Nagorno-Karabakh Denies Armenians and Azeris the Wealth of Their Oil. Second in a Four-Part Series on the Caucusus Nations. Series: CAUCASUS NATIONS. Second in a Four-Part Series on the Caucusus Nations. Next: How New Nations in the Caucasus Survive in Russia's Shadow. Part 1 Ran May 30

Ethnic Conflict in Ex-Soviet Region Keeps Riches out of Reach Fierce Rivalry over Nagorno-Karabakh Denies Armenians and Azeris the Wealth of Their Oil. Second in a Four-Part Series on the Caucusus Nations. Series: CAUCASUS NATIONS. Second in a Four-Part Series on the Caucusus Nations. Next: How New Nations in the Caucasus Survive in Russia's Shadow. Part 1 Ran May 30

Daniel Sneider, Monitor, The Christian Science Monitor

WHEN the Russian Army marched through Moscow last month to mark
the 50th anniversary of victory over Nazi Germany, a miniature
version of the same martial display strutted across the central
square of this mountainous city.

But here, May 9 was more celebrated as the day Armenians
captured the resort city of Shusha three years ago, driving their
Azeri overlords out of their last stronghold in Nagorno-Karabakh --
a rocky region within Azerbaijan that is populated and now
controlled largely by Armenians.

Nagorno-Karabakh has been the focus of a seven-year-long war
between Armenians and Azeris over the status of the territory, and
is the most serious ethnic conflict among the former Soviet states.

During the celebration, units of Armenians in the Karabakh army
marched, kicking their legs stiffly, their Kalashnikov automatic
rifles gripped to their chests. On a balcony stood Robert
Kocharian, the newly elected "president" of the self-styled
Republic of Nagorno-Karabakh.

Respite, but no progress

The guns are now silent, thanks to a year-long cease-fire. Since
an agreement in Budapest last December, a joint Russian-Western
mediation effort under the Organization for Security and
Cooperation in Europe (OSCE) has held round after round of peace
talks.

But the respite in killing has brought little sign of progress
at the negotiating table: The position of the Armenians in Karabakh
has stiffened as they further institutionalize their mini-state. At
the same time, the government of Azerbaijan seems determined to
gain a victory over Nagorno-Karabakh at the conference table that
they have been denied on the battlefield.

"We had a marvelous opportunity that unfortunately remains an
opportunity," laments a senior Western diplomat in Baku, the
capital of Azerbajian. "We have not moved beyond where we were
before Budapest."

The lack of progress over Karabakh is mirrored elsewhere in the
Transcaucusus, a region bedeviled by the scourge of ethnic
conflict. In Georgia, a civil war with a separatist movement in the
region of Abkhazia has also been halted by a Russian and United
Nations-mediated cease-fire. But as in the Karabakh case, the end
of fighting has only frozen the military status quo.

Without ethnic wars, many observers feel the three nations of
this region -- Armenia, Azerbaijan, and Georgia -- would be the
most prosperous in the former Soviet Union. Rich deposits of oil in
the Caspian Sea offer potential wealth to the entire region.

Some Western analysts and governments talk eagerly of a "peace
pipeline," an $8 billion international oil deal signed last year
that would bind the region in lucrative cooperation.

But the vision of wealth is not enough to allow for quick, neat
solutions imposed from above.

"Many people ... think that Armenia is so interested in the
pipeline passing through its territory that it is ready to make
certain concessions on the Karabakh issue," Armenian President
Levon Ter-Petrosyan told the Monitor. "It's a very simplistic
{idea}."

15,000 lives

The Karabakh conflict began in 1988 with a mass movement of
Armenians seeking to separate the Armenian-populated enclave of
Nagorno-Karabakh from the control of Azerbaijan. The ensuing war
claimed at least 15,000 lives and left more than a million refugees
on both sides.

The Armenian republic insists that the conflict is between
Azerbaijan and the Armenians of Nagorno-Karabakh, although the
fighting has at times involved regular Armenian forces, and Armenia
supports the Karabakh army and government.

Since 1993, the Karabakh forces have controlled almost all of
Nagorno-Karabakh and have seized a large swath of territory to the
west and south.

Mediation efforts over the past three years have been stymied by
the divide between the West and Russia. …

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Ethnic Conflict in Ex-Soviet Region Keeps Riches out of Reach Fierce Rivalry over Nagorno-Karabakh Denies Armenians and Azeris the Wealth of Their Oil. Second in a Four-Part Series on the Caucusus Nations. Series: CAUCASUS NATIONS. Second in a Four-Part Series on the Caucusus Nations. Next: How New Nations in the Caucasus Survive in Russia's Shadow. Part 1 Ran May 30

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